Allwyn Entertainment is in advanced negotiations to acquire the business it will replace as operator of the UK’s National Lottery in February 2024.
The next operator of the National Lottery is in negotiations to acquire the current operator, Camelot, in a £100 million agreement that would eliminate Camelot’s final legal fight against the industry regulator.
Allwyn Entertainment is in advanced negotiations with Camelot’s Canadian owner regarding the acquisition of the company’s UK operations.
The unexpected transaction would result in Allwyn’s control of the firm it would replace in February 2024 as the National Lottery operator.
According to sources, an agreement might be reached in the coming weeks, with Allwyn paying in the vicinity of £100 million to acquire Camelot’s UK arm.
It is believed that the Gambling Commission, which handled the issuance of the new license earlier this year, was told of the negotiations.
Withdrawal of pending legal proceedings
If finalized, the transaction would give Allwyn access to Camelot’s UK earnings around one year before it relinquishes control of the National Lottery franchise it has had since its inception in 1994.
Importantly, it would also result in the abandonment of Camelot’s pending legal case against the regulator about the decision to replace it with Allwyn in sixteen months.
The incumbent operator abandoned its appeal against the license decision in September but stated that it would pursue a separate compensation claim.
According to insiders, this would also be withdrawn if Allwyn acquires Camelot’s UK division.
According to a source, the agreement will also ensure Camelot’s complete cooperation with Allwyn during the transition time.
Lottery tickets will cost half as much
The National Lottery is one of the largest lotteries in the world, with players raising over £46 billion for 670,000 good causes in the United Kingdom since 1994.
When Allwyn assumes control of the lottery, it is anticipated that the price of tickets for the main draw would be cut in half to the original £1 price.
In June, Camelot reported that its revenues for the previous year exceeded £8 billion, but admitted that they had declined for the first time in five years.
Former J Sainsbury CEO and current Allwyn chairman Justin King stated last month, “Under Allwyn’s guidance, sales growth is anticipated to result in the allocation of more than double the number of funds to UK charitable organizations.
The next National Lottery will be based on a cutting-edge technological platform that will enhance player security over the next decade and beyond.
The worldwide lottery operator Allwyn attempted to list in the United States through a merger with a special purpose acquisition company last month, but the deal was canceled due to market volatility.
This weekend, it was unclear whether Allwyn’s acquisition of Camelot’s UK subsidiary would also include the Watford company’s lottery operations in Illinois and Ireland.
Persistence in employment
Camelot employs over one thousand individuals, the majority of whom are anticipated to join Allwyn upon the transfer of the license.
Also unknown was whether the Gambling Commission would insist on separate governance arrangements for Camelot’s UK operations following the completion of Allwyn’s acquisition.
Allwyn, which is being assisted in the negotiations by Morgan Stanley, and Camelot declined to comment on Saturday.
